GMO-Global.com purportedly announced in a recent meeting, that Barclays Plc. is to reduce annual costs by $2.6 billion by cutting 3.700 jobs.
After reporting a full year loss of £1.04 billion ($1.63 billion), after reporting profit last year of £3 billion ($4.7 billion), Barclays announced cost cutting measures which will include the loss of some 3,700 jobs.
GMO-Global.com are believed to have commented that the loss includes a fine of £290 million for manipulating benchmark rates that Barclays paid in June, as well as a further £1.6 billion set aside as compensation payments due to be made to clients that were misled while being sold insurance on their debt repayments. This is in addition to the £1 billion set aside for the same purpose during 2011.
Expenses and impairment have both come in at higher figures than were expected. Operating expenses climbed by £200 million up to £21 billion from the previous year.
Shares in Barclays have risen by over 14 percent on the London Stock Exchange so far this year, taking the lead amongst Britain’s main banks. GMO-Global.com reportedly commented that HSBC Holdings has climbed by almost 11 percent so far this year, with Lloyds Banking Group not far behind having advanced by around 10 percent.
Barclay’s cost cutting measures are steeper than had been expected, estimating them to save in the region of £1 billion. The bank intends to close the structured capital markets unit, a part of its investment bank. The totals cuts are expected to cost in the region of £500 million in restructuring charges during the first quarter.